CITY COULD MAKE DEAL TO CUT ENERGY COSTS

Contract with private firm would involve building of cogeneration system at sewage plant

Oceanside would contract with a private company to build and operate a cogeneration system at its La Salina sewage treatment plant in a bid to cut the plant’s energy costs.

“Right now, the gas that the cogeneration facility would use is being flared or burned, so it’s being wasted,” Water Utilities Director Cari Dale said. “This would put it to beneficial use.”

The $750,000 cogeneration system is similar to one the city installed at its San Luis Rey sewage treatment plant in 2009.

The new system is expected to cut energy costs at the La Salina plant by about $625,000 over 15 years, Water Utilities Division Manager Jason Dafforn wrote in a report to the City Council.

The savings would come from using the methane gas that’s produced as a byproduct of treating the sewage to generate electricity and offset some of the natural gas that’s used to heat digesters as part of the sewage treatment.

Under a deal set for City Council review Wednesday, the city would sign a 15-year contract with Boston-based company CHP Clean Energy to build and operate the cogeneration system.

The city would have the option of extending the contract for an additional 10 years or buying the cogeneration system at the end of the 15-year contract.

CHP is the same company that operates the cogeneration system at the San Luis Rey sewage treatment plant.

There would be no cost to the city for the La Salina system, but the city as part of the deal would agree to buy the electricity produced at the plant at rates lower than it would pay San Diego Gas & Electric.

CHP has agreed to sell the electricity to the city for 7.5 cents per kilowatt hour, compared to an average price of 12.5 cents per kilowatt charged by SDG&E, Dafforn wrote in his report.

About half the savings to the city from the cogeneration system would come from the lower electricity costs, with the rest coming from using the heat it generates in place of natural gas the city would have to buy, Dafforn wrote.

The La Salina plant at 1330 South Tait St. treats about 20 percent of the city’s sewage.